The news
- The Blockchain Industry Coordinating Committee of Nigeria (BICCoN) has said the recent actions on crypto platforms by the Nigerian government might push crypto and other virtual asset activities underground
- The Committee is calling on the government to regulate virtual assets in Nigeria responsibly."
- This appeal comes following the clampdown on crypto exchanges in the country. While it agrees with the investigation into exchanges like Binance, BICCoN urges that due process is followed.
Founded in January 2021, BICCoN is an intercommunity working group, comprising three major blockchain bodies/communities in Nigeria: Blockchain Nigeria User Group (BNUG) Cryptography Development Initiative of Nigeria (CDIN); Stakeholders in Blockchain Technology Association of Nigeria (SiBAN).
According to a press release dated March 3, 2024, the group said that "while the activities of virtual asset service providers (VASPs) may present risks to our financial system, proper regulation and enforcement is a more efficient and effective way to safeguard the financial system."
The Committee also referenced the block of crypto websites in the country, saying that while regulators must act when the country's financial system is threatened, how it was done — blocking the sites overnight — will not help Nigeria build needed trust in its financial system.
It also said that the government's actions will push people to take crypto and virtual asset transactions underground where it will be difficult to regulate and oversee.
In a conversation with Techpoint Africa, Adebayo Juwon, CEO of Finna protocol also confirmed this, saying that the government's approach will cause people to source crypto from places where they could get scammed.
Rather than the approach taken by Nigeria, BICCoN advocated "open multi-stakeholder engagements regarding the risks and threats of the activities of VASPs in the country."
Speaking on the detainment of two Binance executives, the group appealed that law enforcement agencies follow the rule of law while investigating the exchange and not send the wrong message to the international community.
It also gave pointers on how the Central Bank of Nigeria can track the $26 billion which Governor, Yemi Cardoso said passed through Binance in 2023.
"Crypto analysis tools are available for the CBN and other relevant agencies to trace transactions. This is indeed one of the benefits of the blockchain."
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To foster a better regulatory environment, BICCoN urged Binance and other exchanges to adhere to regulatory rules in the country. The group also plans to introduce and implement a Code of Conduct for VASPs in the Nigerian market, while encouraging foreign players to identify with local blockchain communities.
